Washington Electric Utilities’ residential customers should see a 1-percent decrease in their electric rates effective July 1.

The proposed reduction, which has not been approved because the City Council has not yet adopted the 2012-2013 budget, would reduce WEU’s revenues by $202,500 annually, said City Manager Josh Kay to the council during its meeting Tuesday.

Reducing electric rates, especially residential electric rates, is a goal of the current council and was a goal of previous councils.

In July 2011, the city reduced the electric rate for residential customers in the city limits by 5 percent.

The council said reducing the electric rate is only one piece of the strategy when it comes to lowering electric bills for WEU customers. Reducing power usage — conservation — is a key piece of that strategy. Reid Brodie, the only person who spoke during the public hearing on the proposed city budget, agrees with that philosophy. Brodie noted the council is on record as doing what it can to lower electric rates.

“What I would like to encourage you to do is not abandon that, but say your goal is to help customers, like yourselves and me, cut our electric bills, and that is different from the electric rate, because there are ways to cut your monthly bill other than the city saying, I’m going to give you a 1-percent discount even though my cost to provide it to you is going to stay right the same,” Brodie said.

Brodie said maybe the city should provide incentives to encourage its power customers to reduce their power usage. He suggested ways to reduce power usage, such as weatherizing houses (including having landlords weatherize their rental units) and purchases of energy-efficient appliances and efficient settings of thermostats on heating and/or cooling appliances.

Brodie also advocated for more WEU customers to use the city’s load-management program, saying expanding that program would help the city and participating WEU customers save money on their electric bills. He noted it costs nothing for WEU customers to participate in the program.

Two years ago, WEU Director Keith Hardt told the council the city’s load-management program would save the city and its participating power customers about $1.3 million a year.

“I advocated for a rate decrease. I still feel that is a desirable goal. I concur with the speaker and in our conversations last month that we need to reduce the bill, and reducing the bill is not necessarily reducing the rate,” Councilman Doug Mercer said. “Reducing the rate is helping reduce the bill in many cases.”

Mayor Archie Jennings noted that WEU customers paid $40 million for power in the past fiscal year.

“That’s $40 million we took out of the local economy. We’ve got to find a way to reduce that impact on our citizens so they’ve got money, more money, to make ends meet, to stimulate the local economy and so forth,” Jennings said. “It does not need to be going into the electric fund year over year over year. I’ll point out we reduced rates last year. We’re probably going to reduce rates this year, but our sales keep going up, nonetheless. I think that’s the danger we run. We’re chasing the wrong rabbit when we’re chasing rates alone. Rates help. They help. They certainly don’t hurt. It’s real money, even if it is nominal money. The real opportunity, the real impact for savings, and we’ve talked about this many, many times, is we’ve got to change the way we do business.”

Mercer noted that some of that $40 million is returned to the local economy in the form of wages paid to city employees and money spent with area businesses for services and supplies.

For more coverage of the council’s meeting, see future editions of the Washington Daily News.